Before withdrawing funds or loans from financial institutions, (the public) must really take into account their abilities because (their progress in paying loans) will be detected for life.
Jakarta (ANTARA) - The Indonesian Financing Firms Association (APPI) has requested the public, especially the younger generation, to adopt a cautious approach while using financial technology (Fintech) services.

"Financial technology can be very helpful, as it is fast and easy when we need money. However, it can be sneaky," APPI Executive Director Susilo Sudjono had stated earlier during a webinar on financial literacy here.

Sudjono did acknowledge the fact that financial technology services offered convenience, albeit not all operating Fintech are registered with the Financial Services Authority (OJK). Moreover, the APPI has advised people to not use illegal financial technology despite the service being much accessible.

Sudjono was concerned that in the event of a problem arising and people reporting to the OJK, the authority would not be in a position to do much, as the Fintech company is illegal, so later it will be processed under the law enforcement authority.

"We have to be careful," Sudjono stated.

To that end, Sudjono also urged the public to check whether the company is registered with the OJK before using any of its financial technology services.

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In addition to checking the legality of Fintech companies, it is important to take into account the ability before applying for loans from financial technology services and other financing institutions.

He noted that all legal financing companies input data into the OJK's Financial Information Service System (SLIK) that contains information on whether the lender is smoothly paying the loan.

"Before withdrawing funds or loans from financial institutions, (the public) must really take into account their abilities because (their progress in paying loans) will be detected for life," Sudjono pointed out.

According to the APPI executive director, when payments are stuck, the creditors' credibility will be recorded in the SLIK, thereby making it difficult for them to apply for loans again.

If this happens to creditors in need of business capital, then they can encounter difficulties in applying for large loans, he stated.

The OJK's National Survey of Financial Literacy and Inclusion (SNLIK) in 2019 stated that 31.26 percent of the respondents had used digital financial services, while those who never used them constituted 68.74 percent.

Those who never used the services reasoned that they did not need, understand, or trust digital financial services.

Related news: Task Force finds 133 illegal P2P fintech, 14 illegal businesses

Translator: Natisha A, Kenzu T
Editor: Rahmad Nasution
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